Australia vs SNF: JUDGMENT

Case Information

  • Court: Full Federal Court of Australia
  • Case No: 2011 ATC 20-265
  • Applicant: Commissioner of Taxation
  • Defendant: SNF (Australia) Pty Ltd
  • Judgment Date: 1 June 2011

The case Commissioner of Taxation v. SNF (Australia) Pty Ltd concerned a dispute over the application of the arm’s length principle in the context of transfer pricing regulations under Australia’s Income TaxTax Assessment Act 1936 (ITAA 1936). SNF, a subsidiary of the French-based multinational SNF Group, had imported chemicals—primarily polyacrylamides—from related foreign suppliers in France, the United States, and China. The Commissioner challenged the pricing of these imports, arguing that SNF Australia had paid its related suppliers more than an independent buyer would under comparable circumstances. Consequently, the Commissioner assessed additional income tax on SNF, claiming that the prices paid exceeded the arm’s length amounts required under Section 136AD(3) of the ITAA 1936.

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Countries: Australia
Tags: ALP, Arms Length Principle, Comparable Uncontrolled Price Method, CUP, Global Tax, Tax Compliance, Tax Law, Tax Risk Management, TNMM, Transactional Net Margin Method, Transfer Pricing